Indian Express Editorial Analysis
08 March 2025
US Exits UN Climate Damage Fund Meant for Poor Nations
(Source – Indian Express, Section – Page No. – 5)
Topic: GS3 – Conservation
Context: Climate justice at a crossroads
The United States, one of the largest historical contributors to global greenhouse gas emissions, has decided to exit the UN’s Loss and Damage Fund (LDF). This move deals a significant blow to the efforts of developing nations that rely on climate reparations to mitigate the devastating impacts of extreme weather events. The decision highlights the ongoing tensions between the Global North and the Global South over climate finance and raises critical questions about equity, responsibility, and global climate governance.
Historical Context and the Evolution of the Loss and Damage Fund
The Birth of Climate Reparations
- The idea of climate compensation gained traction in the 1991 proposal by Vanuatu (on behalf of small island nations) seeking financial support from developed nations.
- The Warsaw International Mechanism (WIM) for Loss and Damage was established in 2013 under the UNFCCC.
- The Loss and Damage Fund (LDF) was officially launched at COP27 (2022) in Egypt, marking a historic step toward climate justice.
US Position: A History of Climate Funding Withdrawals
- The US has a history of inconsistent climate finance commitments:
- Under Donald Trump, the US withdrew from the Paris Agreement (2017), only to rejoin under Joe Biden (2021).
- The US has defaulted on its $2 billion pledge to the Green Climate Fund (GCF).
- Now, its exit from the LDF further weakens trust in international climate cooperation.
Impacts on Developing Nations: The Global South at Risk
Worsening Climate Vulnerability
- Island Nations (e.g., Maldives, Tuvalu, Fiji) – Face existential threats due to rising sea levels, making them heavily dependent on the LDF.
- South Asian nations (e.g., India, Bangladesh, Pakistan) – Suffer from intensifying floods, cyclones, and heatwaves that require substantial post-disaster rebuilding efforts.
- African Nations (e.g., Somalia, Chad, Sudan) – Droughts and desertification threaten food security and force mass displacement.
Financial Shortfall and Broken Commitments
- The LDF was expected to mobilize at least $100 billion annually, but without US participation, the fund faces a severe shortfall.
- This disproportionately affects nations that contribute less than 5% of global emissions yet bear the brunt of climate catastrophes.
Geopolitical and Economic Implications
Weakening Multilateralism
- The US exit emboldens other developed nations to reduce their commitments.
- The EU and China may fill the void, leading to a shift in global climate leadership.
- The decision undermines faith in UN-led climate negotiations and the principle of Common but Differentiated Responsibilities (CBDR).
Trade and Diplomacy Consequences
- The US risks losing influence in climate finance negotiations at COP30 (Brazil, 2025).
- Developing countries may retaliate by aligning with alternative financial coalitions (e.g., BRICS Climate Fund).
- Green technology and carbon tariffs could be weaponized as new tools in geopolitical power struggles.
Judicial and Ethical Dimensions: Is Climate Justice Fading?
Legal Precedents for Climate Responsibility
- The Hague Ruling (2019) – Held the Dutch government accountable for inadequate climate action.
- Caribbean Island Lawsuits (2023) – Small nations sued major polluters for climate damages.
- India’s Position – Calls for global accountability while balancing its domestic energy needs and international commitments.
Moral Responsibility of Developed Nations
- As per the Polluter Pays Principle, the US, with its cumulative emissions exceeding 500 billion tons of CO₂, has a historical obligation to compensate vulnerable nations.
- Pope Francis’s 2023 climate encyclical urged wealthier nations to fulfill their climate finance commitments.
The Way Forward: Finding Alternatives to the Loss and Damage Fund
1. Expanding India’s Role in Climate Finance
- India, with its G20 Presidency legacy, could lead the Global South by proposing a South-South Climate Resilience Fund.
- Strengthening BRICS and IBSA (India-Brazil-South Africa) initiatives could offer an alternative funding mechanism.
2. Reforming Global Climate Finance
- The IMF and World Bank must integrate climate risks into their lending frameworks.
- A legally binding Climate Liability Fund should be explored under the UN.
3. Strengthening Domestic Climate Adaptation
- Developing countries must enhance disaster preparedness, resilient infrastructure, and insurance mechanisms.
- India’s National Adaptation Fund for Climate Change (NAFCC) could be expanded with regional partnerships.
Conclusion: A Setback, But Not the End
The US exit from the UN Loss and Damage Fund is a setback for global climate justice, but it also presents an opportunity for emerging economies like India, China, and Brazil to take the lead. While the move highlights the fragility of international climate commitments, it also underscores the need for self-reliance in climate adaptation. The road ahead is uncertain, but the Global South must strategize innovative climate finance solutions to ensure resilience against future climate shocks.